City and County of Denver, CO

01/08/2024 | Press release | Distributed by Public on 01/08/2024 15:50

Denver Local Minimum Wage Adjusts to $18.81 per Hour for 2025

Denver Local Minimum Wage Adjusts to $18.81 per Hour for 2025

Published on August 01, 2024

Increases Less Than 2023 and 2024 As Inflation Continues to Slow

Denver, CO- The City and County of Denver's local minimum wage will increase fifty-two cents from $18.29 to $18.81 beginning on January 1, 2025. The minimum wage for tipped food and beverage workers will be $15.79 per hour provided they earn at least $3.02 in actual tips. Denver's local ordinance, based on the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W), requires annual adjustments to ensure wages keep up with Denver's cost of living. For 2025's adjustment, the CPI-W for the Denver-Aurora-Lakewood area was 2.84%, less than the CPI-W of 5.8% for 2024 and 8.94% for 2023.

"This raise puts money in the pockets of hard working Denverites and makes us an even more attractive job market for employers and employees alike," said Mayor Mike Johnston.

The scheduled increase comes from the city's local minimum wage ordinance approved unanimously by Denver City Council in November 2019. The ordinance has helped stabilize minimum wage workers and their families who keep our city running but who might fall behind due to the rising cost of living and high inflation.

Denver's local minimum wage is enforced by the Denver Labor Division of the Office of Denver Auditor Timothy M. O'Brien, CPA. Each year the offices of the Auditor, City Council, and the Mayor collaborate to educate and spread the word about the local minimum wage going into effect for the coming year to help employers plan and prepare.

"We all must work together to counter the societal harms and injustice of wage theft. Denver's wage protections are some of the strongest in the United States, but it remains up to each of us to get the word out that we are here to help," Denver Auditor Timothy M. O'Brien, CPA, said.

More information about Denver's minimum wage is at DenverWages.org.

Background on the CPI Methodology Used to Calculate the Minimum Wage

The state legislation allowing local minimum wages in Colorado requires any wage changes to take effect on January 1, the same date adjustments are made to the statewide minimum wage. In order to meet this deadline, a CPI calculation available mid-year of the year prior to the change in wage is required. Denver adopted the approach used by the State of Colorado, which compares the first half of the prior year to the first half of the current year to calculate an adjustment in time for a fall announcement. To set the 2025 minimum wage, Denver's Department of Finance compared the CPI-W for the first half of 2024 with CPI-W for the first half of 2023. The corresponding percentage increase was applied to the current wage of $18.29 to calculate the new, CPI-W adjusted wage for 2025.

Considerations for Employers

Consistent with state law, Denver's local minimum wage allows a reduced wage to be paid to tipped workers in the food and beverage sector only. Employers in the food and beverage industry may claim up to $3.02 per hour for a tip credit, if they have documentation showing their employee received at least that amount in tips. If the full tip credit is applied, the minimum wage rate would be $15.79 per hour. However, the tip credit does not apply to workers in other industries, even if they sometimes receive tips.

Employers with locations near the border of the City and County of Denver: "Employers should not rely on their mailing address to determine whether or not to pay Denver's local minimum wage," Auditor O'Brien said. "We recommend using our regional address finder on our website to check if work was performed within the boundaries of the City and County of Denver."

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Committed to being the best financially managed city and county in the nation, the Department of Finance (DOF) unifies the financial and accounting functions of the City and County of Denver and provides residents easy access to key financial data through Transparent Denver. DOF is divided into the Office of the CFO and seven divisions, including the Assessor's Office, Controller's Office, Budget and Management Office, Capital Planning and Real Estate, Cash and Capital Funding, Risk Management and Worker's Compensation, and Treasury. For more information, visit Denvergov.org/finance.